OCP Group Raises $1.5 Billion in International Bond Issue for Investment and Debt Refinancing

The group’s press release indicates that with this Eurobond, OCP plans to use the funds to finance the second phase of its investment program as well as to partially redeem its existing international bonds maturing in 2024 and 2025, in order to extend the maturity profile of its debt.

For OCP CEO Mostafa Terrab, "the success of this international bond issue testifies to the quality of the OCP Group’s signature with international investors. Furthermore, the objective of this proactive approach by OCP is to optimize our financial structure by taking advantage of the evolution of market conditions," the press release states.

The same source informs that this transaction was a success, as illustrated by the following indicators:

• Operation over 4.7 times oversubscribed for a total of around $7 billion for the two tranches, allowing a significant tightening of rates for the two maturities.
• A negative new issue premium of −10 basis points for the two tranches and the lowest rates achieved by the Group on these maturities.
• The largest order book ever realized in Africa, across all sectors, this year.
• The largest 30-year tranche ever carried out by a company in the MENA region.
The bonds are rated (BB+/stable) by Fitch Ratings and (BB+/stable) by Standard & Poors.
The lead banks mandated for the issue and the implementation of the liability management operation are Barclays, BNP Paribas and J.P. Morgan.
OCP was advised on this operation by Rothschild & Co.

Furthermore, the press release specifies that the conditions on the international capital markets are currently very favorable, which leads the group to issue a new Eurobond in order to benefit from attractive conditions with a view to continuously diversifying its financing resources.

"We have decided to issue long-term instruments, with maturities of 10 and 30 years, which allows us to extend the average maturity of our debt, and thus further reduce the refinancing risk. Market conditions allowed us to benefit from attractive rates for these long maturities. In addition, the fact of issuing at 30 years strengthens the perception of OCP as a premium issuer on the markets capable of offering this type of maturity," it is explained at OCP.